The US has accused Russia of preparing to give "even more powerful rocket launchers" to Ukrainian separatists blamed for shooting down a Malaysia Airlines plane.

The rebels are said to have used a BUK missile, supplied by Moscow, to hit flight MH17 over the east of the country, mistaking it for a Ukrainian plane.

The US has warned of a significant build-up of Russian troops along the border amid fears of a possible "peacekeeping" incursion to support the increasingly embattled separatists fighting government forces.

It comes as President Barack Obama and leaders from Britain, Germany, France and Italy agreed to impose a wider set of sanctions against Russia's financial, defence and energy sectors.

Image Caption:Fighting is continuing in eastern Ukraine

Until now, the EU sanctions have not been as tough as the American ones as Europe is more reliant on deals with Russia.

The new penalties are aimed at putting more pressure on President Vladimir Putin.

He added: "We've seen a significant rebuild up of Russian forces along the border, potentially positioning Russia for a so-called humanitarian or peacekeeping intervention in Ukraine."

The US earlier released satellite images it claimed show rockets have been fired at Ukraine from within Russia.

The images, which come from the US Director of National Intelligence and have not been independently verified, also purport to show that heavy artillery for pro-Russian separatists has crossed the border.